Money surely makes the world go around. And this is clear from the way the lot of us keep on chasing it through every hour of the day and night that we live. But who are the biggest money managers in the world and to put an interesting twist, which are the specialist money management cities in the world?
The money management business started from the continent of Europe. Logic will dictate the biggest money managers to be from Europe too but that is seriously not the case. The big-ticket money managers are to be found in the United States. Aided by the fast growth in the US economy after the second world war that propelled it to leap frog ahead of the pre war economies like the United Kingdom, Germany and France to occupy pole position and favourable legislations like the 401k plans, the money management industry and inter alia the mutual fund industry jumped ahead of all other countries (continents).
In an analysis of the biggest companies, and we restricted ourselves to the top 20, it is clear that the power house organisations lie in the United States. The top 2
0 mutual funds have a total assets under management size of a little more than 58 trillion dollars. To put it in perspective, the GDP of the United States, the biggest economy in the world is close to 29 trillion USD. AND, the money managed by these twenty companies is TWICE THE SIZE OF THE UNITED STATES ECONOMY. Impressive and scary!!!
As far as companies go, there is a similar skew between the top 2 and the rest. These are BlackRock and Vangaurd. Together they account for a massive 17 trillion USD of money to manage. AGAIN, to put is perspective, if the Indian GDP is 4.3 trillion USD, then these two account fo
r nearly four times of it. It is commonly said, these two companies own everything that is worth owning , and who knows, perhaps each other too. Interestingly, the current Vangaurd CEO, Salim Ramji is an ex BlackRock executive. Further, there are two companies in the group, PIMCO and Amundi, which are subsidiaries of two others in the group, Allianz Group and Credit Agricole. Incidentally both the mother companies are Europe based whereas the two subsidiaries are based in both the continents.
And now coming to the cities. The twenty biggies are based out of 14 locations, and of course majorly the United states but country wise, these are only in 5 countries – The United States, France, Germany, England and Switzerland. The cities with the biggest representation amongst the twenty are named in the illustration. No prizes for guessing right, New York stands right at the top followed closely by Pennsylvania and Boston. But, while Pennsylvania is represented by just 1, New York and Boston have multiple companies represented. On the basis of this multi representation alone, I will be tempted to give the silver medal to Boston. Who would have thought Charlotte, Newport and Atlanta to be represented.
How many are there as mutual funds in India. Not many unfortunately!!! Which leads me to believe that the entry of these power houses will happen sooner or later. Who can ignore this big a market which is going at this speed. And just imagine how it will expand further when they are here, bringing their global advisory practices, the wealth of experiences acquired from all over the world and of course the management skills. We are all in for a great, long ride.
